DOVER — After a rough patch in the auto industry, New Hampshire car dealers are calling for new protections in state law that they argue would restore local control to the auto market.

The New Hampshire Automobile Dealers Association (NHADA) is backing a Senate bill that would revise some aspects of the state's auto trade laws. Among other things, the bill would prevent automakers from forcing dealers to upgrade facilities more frequently than once every 15 years. It would also allow dealers to buy local goods and ensure they are reimbursed at the market rate for parts used in warranty work.

NHADA President Peter McNamara recently joined six car and equipment dealers from around New Hampshire to argue on behalf of the bill during a meeting with the editorial board of Foster's Daily Democrat.

NHADA represents more than 570 businesses in the state, about half of which have franchise agreements with manufacturers. They come from different sectors, including dealers in trucks, motorcycles, off-road vehicles, snowmobiles, ATVs and RVs.

New Hampshire already has a so-called “Dealer Bill of Rights,” which has been on the books for about 40 years. Nevertheless, dealers say manufacturers still control nearly all aspects of the retail business, leaving them with little choice over how they sell and service cars.

Senate Bill 126 would tweak state laws to give the car dealers more leverage. It passed with overwhelming support last week in the Senate on a 21-2 vote, and will now head to the House for debate.

Automakers have railed against the bill, calling it a government overreach that will result in bad public policy. But car dealers say nearly all of the changes they're proposing are based on laws that are already on the books elsewhere around the country. The bill will help bring transparency to a marketplace dictated by the whims of carmakers, they say.

“It really boils down to local control ...” McNamara said. “The dealerships wanted local control over their own facilities, their own future, their own debt, in that sense, and also about buying local.”Moratorium on facility changesOne common grievance among local car dealers is the burden of upgrading their showrooms and service centers to comply with manufacturer programs.

Dealer Paul Holloway said he found himself in this predicament after making costly upgrades to his Mercedes-Benz dealership in Greenland. At the urging of the manufacturer, Holloway said he paid millions to upgrade his building in 2002. Then, three years later, the manufacturer began pushing a new design called the “auto house” for its dealers.

Holloway said he faced pressure from the dealer to not only remodel the interior, but also pay for exterior upgrades that included installing a flat roof.

“Flat roofs in New Hampshire doesn't make a lot of sense,” he said, “but they came with drawings how we could modify the building, and the only thing that kept us from having to do it was the zoning laws in Greenland.”

In the end, the business still had to make interior modifications, which included tearing up tiles and replacing doors. They also swapped solid-cherry wood furniture with pressboard furniture, which is already wearing out. The dealership was also asked to replace “top-quality rugs” with rugs that wore out in five years, Holloway said. And the interior design specifications are controlled so tightly that employees can't even hang pictures of their kids on the wall, he said.

“That's the way it is ...” he said. “If you want to be a dealer, this is what you do.”

Dealers also face mandates to buy certain decorative items and design elements. In some cases, these items can only be purchased from a single vendor, and the dealers say this often comes at a high price.

Those who don't comply risk losing out on bonuses. For Holloway, non-compliance meant risking losing a 2 percent bonus on the sticker price of each car he sold at the business. On an average Mercedes, this amounted to roughly $800, he said.

Roger Groux, owner of the Honda Barn in Stratham, said his building is now nine years old, and Honda is already asking him to remodel it at a cost of between $1.5 million and $2 million. Groux said he hasn't finished making loan payments on the last project — a circumstance that isn't uncommon, since commercial amortization is often granted in 15-year blocks.

The NHADA also points to scientific research that suggests standardizing car dealerships doesn't increase sales. On the contrary, franchises that allow some variation from one store to the next — such as Apple and Dunkin' Donuts — still manage to thrive, McNamara said.

“It's not the exterior,” he said. “It's the iPad; it's the doughnut. And it's the same with the vehicles here. It's not the leather couch in the showroom, or the big metal swoop on the outside. It's the vehicle that's inside of there. It's the product.”Accessing the 'dealer file'Car dealers say Senate Bill 126 contains only one provision that does not exist elsewhere in the country. If the bill passes, dealers would gain the right to request a copy of their so-called “dealer file” from the manufacturer. The bill would only allow dealers to request information that portrays them negatively in the eyes of the manufacturer, according to McNamara. Such documents would include reports that describe a failure by the dealer to satisfy terms of sales and service agreements, he said.

To understand why the provision is necessary, McNamara pointed to the example of local car dealer Ron Poulin, who was forced to close down his Chevrolet dealership while the manufacturer was restructuring. Poulin believes his business was targeted for termination by the manufacturer, regardless of its sales record or geographical location.

“When we were going through our arbitration trying to basically stay alive, it was impossible to get any information from them, and yet we knew that they had been trying to get rid of us for awhile — well before the bankruptcy,” he said.

Representatives from the Alliance of Automobile Manufacturers have argued against the dealer file provision. They say the language in the bill is so broad that car dealers could request anything they desired — even proprietary information.

But Groulx, of Honda Barn, calls that argument a “smokescreen.” He points out that manufacturers already have the ability to inspect the records of their dealers at any time.

“They can probe around our mainframe all they want,” he said.

Bob Marrazzo, owner of Townline Equipment in Plainfield, pointed out that manufacturers can also restructure local markets with little notice. Dealers are measured on market share, but determining the size of the local market can be tricky, he said.

Poulin offered an example of one such unexpected market shift.

“We had Pittsfield added to our area,” he said. “Pittsfield, New Hampshire, (added) to Rochester. Can you imagine that?”

Paying the market rateCarmakers have also criticized the new bill because it requires manufacturers to pay dealers a market rate for warranty work — including both parts and labor. Manufacturers say this provision will drive up costs, ultimately hurting consumers.

But NHADA argues that manufacturers are already supposed to be paying market rates, as directed by a provision in the state's uniform commercial code. The code requires manufacturers of all kinds to pay a market rate for the parts used in warranty repairs. Some carmakers, including General Motors, Toyota, Mercedes and Honda, already comply with this regulation, but others don't.

Another provision in Senate Bill 126 would prevent carmakers from raising their prices to offset higher dealer costs. Manufacturers say they'll be forced to hike up prices around the country to compensate for the changes in New Hampshire. Ultimately, the state could wind up in a court battle over the issue, representatives from the Alliance of Automobile Manufacturers warned last week.

In response, McNamara said their argument is “ridiculous, overreaching” and “overbearing.” A federal court in Maine has already ruled that the warranty protections are valid, McNamara said.

“All we want is to say ... this is a collaborative,” said Myles Cook, owner of Rochester Motorsports. “This is not a master-servant relationship. This is a collaborative relationship where we work together toward a means of selling cars, selling tractor equipment, selling powersports. That's the relationship that this should be.”